NEAR-SHORING APPAREL SUPPLY CHAINS

Time for some home truths

A common cry we hear in global textile supply chains is that near-shoring is a more sustainable and perhaps ethical option for apparel brands. In the past couple of years, we have seen evidence—albeit limited—of this, with the US President Donald Trump talking about bringing manufacturing home, and efforts by the UK to redevelop its once-burgeoning textile industry.

In theory, near-shoring is more sustainable for a couple of reasons. Firstly, it cuts down on CO2 emissions associated with the international transport of textiles and clothing. Secondly, there is a train of thought (which is far from proven) that local production equals ethical production.

The first of these arguments is difficult to dispute. If something is made in the US and sold in the US, its GHG (greenhouse gas) emissions associated with transportation will clearly be lower than if it were made in Asia and transported to the US.

The second argument is less clear-cut. There are tens of thousands of apparel factories in the world. Some are ethical and treat their staff well, paying them a fair wage. Many, as we all are aware, are not. But the point is, the whereabouts of these factories are random. Asian apparel sourcing hubs do not have a monopoly on poor worker rights. There are good and bad factories in Bangladesh and, indeed, in other sourcing hubs such as China and Vietnam. But there are also good and bad factories in the UK, in the US, in Eastern Europe.

The one common denominator with all of these factories, wherever they are based in the world, is that they face downward pressure on prices from apparel brands. This means there is, in turn, downward pressure on wages for factory workers. This is not a well-paid industry, wherever you operate in the world, and that’s just basic economics.

But there is another, perhaps more important factor, to consider in the discussion around near-sourcing. As intimated, there is often an assumption that closer to home is more sustainable. But what if production techniques in textile supply chains in Asia are better than those in the West? What if they are cleaner, use less water, use less chemicals and create less waste? Actually, this—textile production techniques—is something we all need to consider in the debate about where apparel is made. Brands, policymakers and economists all need to be part of this discussion.

As a factory owner myself, I can attest to the huge strides made in apparel production in recent years. The industry in Bangladesh is undergoing a minor revolution. In denim production, for instance, new techniques are being introduced which use far less water than was previously the case, while factories are also becoming much smarter on the issue of water recycling and harvesting the use of rainwater.

Wastewater, meanwhile, is managed far better, often being cleaned using costly effluent treatment technology so it can be used again and again. This is an ongoing pattern of continuous improvement, and many factories are in the process of serious industrial upgrading in this area.

In the area of chemicals, new methods are being introduced, the net result of which means that less chemicals are used in clothing production, and the chemicals that are used are carefully scrutinised to ensure they are not hazardous or harmful to humans. Getting to grips with this issue has taken years and has been helped enormously by the Zero Discharge of Hazardous Chemicals, which has helped foster good practice across supply chains.

In case of Bangladesh, we can also consider the fact that the industry has undergone a huge safety overhaul. Garment factories in the likes of Bangladesh are cleaner, safer, more efficient and more sustainable than at any time in history—that’s no exaggeration. Billions of dollars have been spent in a process of industrial and technological upgrading that continues in all garment production hubs in Asia as they battle to win and maintain the business of brands.

How ironic, then, that having reached this current state, there is talk of taking garment production “back home,” as part of a pattern of near-shoring.

In actual fact, there is not a great deal of evidence to suggest that near-shoring is happening. Statistics suggest that some production has left China for the US but the picture is very mixed. If anything, production and output in the likes of Bangladesh is actually continuing to increase. Bangladesh has had a fantastic 12 months in terms of export revenues.

Why is this? A personal hunch is that near-shoring is a political slogan and not much else for the time being. Brands have been placing greater and greater demands on their Asian apparel suppliers to produce smarter, faster, and cleaner. In short, to produce more sustainably. This has not happened overnight, and it has been a major, hugely expensive learning process for all involved.

There is now a level of sustainability learning and expertise in Bangladesh’s apparel supply chain which would take years to replicate elsewhere, even if there was a will to do so—which is far from evident.

Politicians might like to talk about near-shoring, but for brands, it is action not rhetoric that counts when it comes to purchasing sustainably. And on this front, for now at least, Bangladesh’s RMG sector holds all the trump cards.

Mostafiz Uddin is the Managing Director of Denim Expert Limited. He is also the Founder and CEO of Bangladesh Denim Expo and Bangladesh Apparel Exchange (BAE). He can be reached at mostafiz@denimexpert.com.